Question

Accounts payable	$       40,000
Accounts receivable	33,000
Accumulated depreciation—buildings	25,000
Accumulated depreciation—equipment	20,000
Advertising Expense	4,500
Bonds payable, due December 31, 2024	260,000
Buildings	180,000
Capital stock, $1 par value	220,000
Cash	92,120
Commission Expense	8,400
Cost of Goods Sold	31,480
Depreciation Office	2,970
Equipment	75,500
Income Tax Expense	7,150
Income taxes payable	3,860
Insurance Expense Sales Auto	3,200
Interest Expense	1,550
Interest payable	890
Interest Revenue	1,900
Inventory	74,000
Land	240,000
Notes payable, due April 15, 2020	7,000
Office supplies	350
Paid-in capital in excess of par value	100,000
Prepaid expenses	5,000
Rent Expense - Office	2,850
Retained earnings	63,020
Salaries & Wages - Office	6,980
Salaries & Wages - Sales	12,580
Salaries payable	5,200
Sales Revenue	95,890
Supplies Expense - Office	990
Trademark	45,000

1. Complete Multistep Income Statement

Gross Profit

Operating Expenses

Selling Expense

Total Selling Expenses

General & Admin Expenses

Total General & Admin Exp

Total Operating Expenses

Income (loss) from Operations

Other Revenues & Expenses

Excess of Other Revenue over Other Exp

Income before taxes

Net Income

Answer 1

Multistep Income Statement
Sales revenue			95890
Less: Cost of goods sold			31480
Gross profit			64410
Operating expenses:
Selling expenses:
Advertising expense	4500
Commission expense	8400
Insurance expense sales auto	3200
Salaries & wages - sales	12580
Total selling expenses		28680
Administrative expenses:
Depreciation office	2970
Office supplies	350
Salaries & wages - office	6980
Supplies expense - office	990
Total administrative expenses		11290
Total operating expenses			39970
Income (loss) from operations			24440
Other revenues and expenses:
Interest revenue		1900
Interest expense		-1550
Excess of other revenue over other expenses			350
Income before taxes			24790
Income tax expense			7150
Net income			17640